Inequality-adjusted Human Development Index (IHDI)

The IHDI takes into account not only the average achievements of a country on health, education and income, but also how those achievements are distributed among its population by “discounting” each dimension’s average value according to its level of inequality. The IHDI is distribution-sensitive average level of HD. Two countries with different distributions of achievements can have the same average HDI value. Under perfect equality the IHDI is equal to the HDI, but falls below the HDI when inequality rises. The difference between the IHDI and HDI is the human development cost of inequality, also termed – the loss to human development due to inequality. The IHDI allows a direct link to inequalities in dimensions, it can inform policies towards inequality reduction, and leads to better understanding of inequalities across population and their contribution to the overall human development cost.

This year we have introduced the Coefficient of human inequality, a new measure of inequality in HDI, calculated as an average inequality across three dimensions. For more details on computation, see Technical notes.

The IHDI is calculated for 145 countries.

The average global loss in HDI due to inequality is about 22.9 %—ranging from 5.5% (Finland) to 44.0% (Angola). People in sub-Saharan Africa suffer the largest losses due to inequality in all three dimensions, followed by South Asia and the Arab States and Latin America and the Caribbean. Sub-Saharan Africa suffers the highest inequality in health (36.6%), while South Asia has the highest inequality in education (41.6%). The region of Arab States also has the highest inequality in education (38%), Latin America and the Caribbean suffers the largest inequality in income (36.3%).